File PR-2023-014 Onix Networking Canada Inc.

Decision made Monday, June 19, 2023 Decision issued Tuesday, June 20, 2023 Reasons issued Thursday, July 6, 2023

 

IN THE MATTER OF a complaint filed pursuant to subsection 30.11(1) of the Canadian International Trade Tribunal Act.

BY

ONIX NETWORKING CANADA INC.

AGAINST

THE DEPARTMENT OF PUBLIC WORKS AND GOVERNMENT SERVICES

DECISION

Pursuant to subsection 30.13(1) of the Canadian International Trade Tribunal Act, the Canadian International Trade Tribunal has decided not to conduct an inquiry into the complaint.

The statement of reasons will be issued at a later date.

 

STATEMENT OF REASONS

[1] Subsection 30.11(1) of the Canadian International Trade Tribunal Act[1] (CITT Act) provides that, subject to the Canadian International Trade Tribunal Procurement Inquiry Regulations[2] (Regulations), a potential supplier may file a complaint with the Canadian International Trade Tribunal concerning any aspect of the procurement process that relates to a designated contract and request the Tribunal to conduct an inquiry into the complaint. Subsection 30.13(1) of the CITT Act provides that, subject to the Regulations, after the Tribunal determines that a complaint complies with subsection 30.11(2) of the CITT Act, it must decide whether to conduct an inquiry into the complaint.

SUMMARY OF THE COMPLAINT

[2] The complaint by Onix Networking Canada Inc. (Onix) relates to a request for proposal (RFP) (solicitation G9292-227373/B) issued by the Department of Public Works and Government Services (PWGSC), on behalf of the Department of Employment and Social Development, for a “Managed Search Service” software solution delivered through a software as a service subscription model.

[3] Onix raises two grounds of complaint. First, it submits that the evaluation criteria for the financial bid contained in the RFP were ambiguous and that this ambiguity necessitated two subsequent clarifications after the bid closing date. Second, Onix takes issue with the clarification requests by PWGSC being sent by email rather than through the issuance of formal amendments to the solicitation documents, challenging the transparency of the process and consistent application of the evaluation criteria. As a remedy, Onix requests the issuance of a new solicitation for the designated contract.

[4] A contract was awarded to the successful bid submitted by Computacenter TeraMach Inc. (CTI) for an amount of $14,994,292.07 excluding HST.

[5] For the reasons below, the Tribunal has decided not to conduct an inquiry into the complaint.

BACKGROUND

[6] The RFP in question was published on CanadaBuys.canada.ca[3] on March 29, 2023, with an initial closing date of April 18, 2023. Amendment 001 extended it to April 25, 2023. PWGSC answered questions from potential bidders through amendments 002, 003 and 004 published on April 18 and 20, 2023. Onix submitted its bid on April 25, 2023.[4]

[7] On May 3, 2023, Onix was notified that its bid met all mandatory requirements and was subject to the Relevance Test set out in Annex I to the RFP.[5] It had until May 10, 2023, to provide the link for the Department of Employment and Social Development to access the test.

[8] On May 15, 2023, Onix followed up on the status of the Relevance Test and bid outcome. PWGSC replied, on May 16, 2023, stating that it should have a final result the next day.

[9] On May 18, 2023, Onix received an email from PWGSC asking all bidders to present their cost per query (e.g., $0.0060 per query) that were used to calculate the submitted prices in tables 1 and 2.A of Annex B (Basis of Payment) to the RFP. PWGSC requested that this per-query cost be provided directly in the tables found in the email by the end of the day.[6] The same day, Onix provided the requested information,[7] and PWGSC replied by asking the following: “Is it possible to provide a query price which would accommodate the 3 types of pricing? We require a single price to use for our financial evaluation against other bidders.”[8]

[10] On May 19, 2023, Onix asked to set up a call the same day to discuss PWGSC’s request. After the meeting, PWGSC emailed Onix and wrote that it “took [Onix’s] original bid firm price and divided by 500M.” Onix replied, “[c]onfirmed and accepted.”[9]

[11] On May 23, 2023, PWGSC emailed Onix, informing it that it had again revised tables 1 and 2.A of Annex B by introducing three tiers of pricing and requested that the modified tables be once again completed by Onix as soon as possible.[10]

[12] Onix provided a revised submission on May 26, 2023.[11] The same day, PWGSC emailed a regret letter to Onix stating that, although its bid was found to be responsive to the mandatory requirements of the solicitation, it did not rank the highest using the evaluation methodology described in the solicitation. Onix was informed that a contract had been awarded to CTI for an amount of $20,010,147.98 excluding HST.[12]

[13] On June 2, 2023, Onix made an objection to PWGSC via email, challenging the award of the contract to CTI.[13] In response to Onix’s objection, PWGSC replied, on June 5, 2023, that it had re‑evaluated the bids against the original financial bids.[14] PWGSC advised that a contract had been awarded to CTI for an amount of $14,994,292.07 excluding HST.[15]

[14] Onix submitted its complaint with the Tribunal on June 7, 2023. On June 8, 2023, the Tribunal, pursuant to subsection 30.12(2) of the CITT Act, notified Onix that it required further information before its complaint could be considered filed. On June 12, 2023, Onix provided the requested information to the Tribunal, and its complaint was therefore considered filed.[16]

ANALYSIS

[15] Pursuant to section 6 and 7 of the Regulations, after receiving a complaint that complies with subsection 30.11(2) of the CITT Act, the Tribunal must determine whether the following four conditions are met before it can conduct an inquiry:

(i) the complaint has been filed within the time limits prescribed by section 6 of the Regulations;

(ii) the complainant is a potential supplier;

(iii) the complaint is in respect of a designated contract; and

(iv) the information provided discloses a reasonable indication that the procurement has not been conducted in accordance with the relevant trade agreements.

[16] As mentioned previously, Onix raises two grounds of complaint. The first allegation is that the evaluation criteria for the financial bids contained in the RFP were ambiguous. Onix claims this ambiguity stems from the fact that PWGSC modified, on two occasions, tables 1 and 2.A of Annex B, which set out the RFP’s financial evaluation criteria. The second allegation is that PWGSC improperly sent the revised financial evaluation criteria and related clarification requests to bidders regarding their financial bids by email rather than through the issuance of formal amendments to the solicitation documents. Onix submits that this course of action calls into question the transparency of the process and the consistent application of the evaluation criteria.

[17] For the following reasons, the Tribunal finds that the conditions of inquiry are not met for either of Onix’s grievances. Specifically, the two grounds of complaint were not filed within the time limits set out in section 6 of the Regulations and, at any rate, the information provided did not disclose a reasonable indication that the procurement has not been conducted in accordance with the relevant trade agreements.^[17] Each ground of complaint will be examined in turn.

Allegation of ambiguity in the financial evaluation criteria

The first ground of complaint is time-barred

[18] Subsection 6(1) of the Regulations provides that a potential supplier must file a complaint with the Tribunal no later than 10 working days after the day on which the basis of the complaint became known or reasonably should have become known to the supplier.

[19] Subsection 6(2) of the Regulations, in turn, provides that a potential supplier that has made an objection to the relevant government institution, and is denied relief by that government institution, may file a complaint with the Tribunal “… within 10 working days after the day on which the potential supplier has actual or constructive knowledge of the denial of relief, if the objection was made within 10 working days after the day on which its basis became known or reasonably should have become known to the potential supplier.”

[20] These provisions make it clear that a complainant has 10 working days from the date on which it first becomes aware, or reasonably should have become aware, of its ground of complaint to either object to the government institution or file a complaint with the Tribunal.

[21] In general, when a ground of complaint relates to the terms of a solicitation, the Tribunal has previously considered the date on which a bidder obtains a copy of the solicitation documents to be the date on which the bidder becomes aware of the basis of that complaint.^[18] Without evidence to the contrary, bidders are generally considered to have obtained a copy of the solicitation on the date of publication.^[19]

[22] In this case, as mentioned above, PWGSC issued the RFP on March 29, 2023. However, Onix’s allegation is that the ambiguity in the terms of the solicitation primarily results from the two rounds of clarification requested from bidders regarding their financial bids and the related changes apparently made to the methodology used for the evaluation of the financial bids after the closing date of the solicitation.

[23] These clarification requests, which Onix claims modified the criteria set out in the RFP for the evaluation of financial bids, were communicated to Onix on May 18 and 23, 2023. Therefore, the Tribunal finds that, at the latest, Onix became aware of the basis for its allegation that the financial evaluation criteria were ambiguous when it received, by email on May 23, 2023, PWGSC’s second request to amend Annex B included in Onix’s bid based on revised instructions. As of that date, Onix was clearly aware that, as it puts it in its complaint, the “ambiguity [in the financial evaluation criteria] necessitated two rounds of clarifications after the submission due date.”^[20]

[24] At that point in time, Onix thus knew or reasonably should have known the basis of its complaint concerning the ambiguity that it perceived in the methodology to be used by PWGSC to evaluate the financial bids. Given that 10 working days after May 23, 2023, is June 6, 2023, on or before that date, Onix had to either file a complaint with the Tribunal or make an objection to PWGSC with respect to this allegation to comply with section 6 of the Regulations.

[25] The question of whether subsection 6(1) or (2) applies with regard to a complaint turns on the question of whether an objection was made to the relevant government institution.

[26] Onix submits that it made an objection to PWGSC on June 2, 2023. However, nowhere in its email to PWGSC’s relevant official in which Onix objects to the outcome of the solicitation does Onix allege that the evaluation criteria for the financial bids contained in the RFP were ambiguous. While Onix then disputed PWGSC’s decision to alter the terms of the solicitation twice after bid closing and requested, as a remedy, that all bids be re-evaluated according to the original criteria and original Annex B submitted by technically compliant bidders as of the RFP closing date, it never raised with PWGSC that the financial evaluation criteria (either original or revised) were unclear or inadequate.

[27] In its June 2, 2023, email to PWGSC, Onix did not claim, as it now does in its complaint, that the fact that the RFP set out two levels or tiers for the evaluation of prices indicated in the financial bids created ambiguity in the terms of the solicitation.^[21] Similarly, Onix failed to request in its purported objection that PWGSC issue a new solicitation with different financial evaluation criteria, which is the remedy sought in this complaint. Therefore, the basis for its grievance at that time had nothing to do with alleged ambiguity in the financial evaluation criteria set out in the RFP. To the contrary, Onix requested that PWGSC use the original criteria set out in Annex B of the RFP and re‑evaluate all compliant bids on that basis. In other words, the remedy requested by Onix at that time is not the same as the one requested to the Tribunal in this complaint.

[28] In short, the ground of complaint invoked and the remedy sought in Onix’s objection are different than the matter subsequently raised with the Tribunal. In Cougar Aviation Ltd. v. Canada (Minister of Public Works and Government Services),^[22] the Federal Court of Appeal upheld the Tribunal’s interpretation that subsection 6(2) of the Regulations applies only to those grounds of complaint to which an objection to the government institution expressly referred. The Court notably indicated that, “[i]f the informal procedure for settling complaints is to be effective, an objection must be described with sufficient specificity as to enable the Department to deal with it.”^[23]

[29] It is thus clear on the basis of jurisprudence that not every communication indicative of some form of dissatisfaction engages subsection 6(2) of the Regulations and constitutes an objection with regard to a complaint. For that subsection to be engaged for the purposes of a subsequently filed complaint, the communication must be sufficiently specific in identifying the matter at issue, and that matter must form the substance of the complaint subsequently filed with the Tribunal upon a denial of relief. Otherwise, as in this case, the contracting authority is not given an opportunity to address the specific aspect of the procurement process, which is disputed by a potential supplier, prior to the matter being raised with the Tribunal.

[30] Accordingly, the Tribunal finds that Onix failed to make an objection pertaining to its allegation that the financial evaluation criteria were ambiguous, even though it had written a letter of objection to the procuring government institution on June 2, 2023, since the issue forming the substance of the first ground of complaint was not expressly raised in that letter.

[31] In the absence of a valid and timely objection alleging with sufficient precision that the financial evaluation criteria of the RFP were ambiguous, subsection 6(1) of the Regulations applies in this matter. In other words, the absence of an objection excludes subsection 6(2) of the Regulations and engages the prescribed time limit stipulated in subsection 6(1). Having already determined that Onix became aware of the basis of its first ground of complaint, at the latest, on May 23, 2023, it had to file its complaint on this ground not later than 10 working days after that day (that is, on June 6, 2023). Thus, the complaint filed with the Tribunal by Onix on June 12, 2023, by application of subrule 96(1) of the Canadian International Trade Tribunal Rules, was filed on a date beyond the time limit stipulated in subsection 6(1) of the Regulations.

The first ground of complaint does not disclose a reasonable indication of a breach of the applicable trade agreements

[32] In any event, even if the complaint in respect of this allegation had been timely, the Tribunal would have found that the information provided did not disclose a reasonable indication that the procurement had not been conducted in accordance with the relevant trade agreements. The evidence indicates that Onix and PWGSC met to discuss the revised pricing information that was requested by PWGSC on May 18 and 23, 2023 and Onix was able to promptly submit revised pricing tables. At no time did Onix suggest that the apparent revised financial evaluation criteria were ambiguous. On the contrary, at all relevant times, Onix appeared to have a good understanding of the clarification concerning its financial bid that was requested by PWGSC. It also seems that Onix was able to provide all the additional or different information that PWGSC was seeking. Onix even confirmed on May 19, 2023, that it accepted certain recalculations made by PWGSC to its revised Annex B. It is also worth noting that PWGSC sought clarification from Onix because, initially, the breakdown of Onix’s pricing information provided in its revised Annex B did not match the total aggregated prices indicated in its original financial bid.^[24]

[33] Furthermore, the evidence indicates that, ultimately, PWGSC did not evaluate the financial bids based on any modified criteria or consider additional pricing information submitted by Onix or other bidders after the closing date of the solicitation in its evaluation of the financial bids. As Onix requested in its letter of June 2, 2023, PWGSC indicated that it re-evaluated the financial bids in accordance with the original criteria, specifically the original format of Annex B of the RFP.^[25]

[34] It therefore cannot be said that PWGSC inappropriately disregarded, modified or relaxed the requirements of the solicitation after the deadline for the submission of bids or changed the weighting method for evaluating the bids. Similarly, since PWGSC eventually did not consider the revised financial bids, the Tribunal is not persuaded that it gave bidders an opportunity to change their financial bids individually after bid closing, which could have been problematic.^[26] Because it chose to grant to Onix the relief requested on June 2, 2023, PWGSC essentially rendered moot any allegation that it failed to follow the evaluation procedures set out in the RFP. Put another way, because, in the end, PWGSC proceeded with the evaluation of the financial bids in accordance with the method described in the original RFP, there is no basis to cancel this tender and to recommend to PWGSC to issue a new tender for this designated contract, as requested by Onix.

[35] In the final analysis, there is no reasonable indication that PWGSC failed to follow the evaluation methodology set out in the RFP or that the evaluation criteria for the financial bids were ambiguous.^[27] In the absence of allegations, much less evidence, that PWGSC erred in its evaluation of financial bids or that Onix should have been the contract awardee based on the application of the methodology set out in sections 4.4 (Financial Evaluation) and 4.5 (Basis of Selection) of the RFP, the Tribunal sees no reason to interfere with the results of the evaluation process.^[28]

Allegation that clarifications sought by PWGSC should have been issued as formal amendments to the solicitation rather than by email

The second ground of complaint is also time-barred

[36] As for the allegation that PWGSC breached the applicable trade agreements because its clarification requests concerning the financial bids were not the subject of amendments or addenda to the solicitation documents, the Tribunal must also conclude that this ground of complaint was not filed within the time limits set out by section 6 of the Regulations.

[37] Again, the letter that Onix sent to PWGSC on June 2, 2023, to object to the outcome of the solicitation, is silent on the issue of the lack of transparency of the process. Also, Onix did not allege an inconsistent application of the evaluation criteria caused by the fact that PWGSC’s clarification requests were sent by email. It bears repeating that, as a matter of law, a letter to a contracting authority can only be considered an objection to those aspects of the procurement process to which it expressly refers.

[38] Given that the objection made by Onix does not cover the same alleged flaw in the procurement process that Onix subsequently raised with the Tribunal in its complaint, subsection 6(2) of the Regulations is not relevant to this ground of complaint. It is therefore subsection 6(1) of the Regulations that establishes the deadline for filing a complaint with the Tribunal on this ground as well.

[39] The Tribunal finds that Onix knew or reasonably should have known by May 23, 2023, that PWGSC would not issue formal amendments to the RFP to address the alleged modifications to the information to be provided by bidders in Annex B as part of their financial bids. At that time, it was clear that PWGSC would proceed by way of email to obtain the additional or different information that it required.

[40] To the extent that Onix considered that this process was not permissible, it had to file its complaint to the Tribunal with respect to its allegation of misconduct in this regard not later than June 6, 2023 (i.e., 10 working days after the day on which the basis of the complaint became known or reasonably should have become known to it). However, the complaint was only considered filed on June 12, 2023.

[41] The Tribunal reiterates that bidders cannot adopt a “wait-and-see attitude” in procurement complaints in which time is of the essence, and the procurement review process does not provide for grievances to be accumulated and then presented only when a proposal is rejected.^[29] At that time, it is too late to complain about perceived deficiencies in the conditions specified or, for that matter, not adequately spelled out in the RFP.

The second ground of complaint does not demonstrate a breach of the applicable trade agreements

[42] At any rate, the Tribunal has already explained that, in its view, PWGSC did not ultimately alter the financial evaluation criteria and proceeded to evaluate the bids in accordance with the requirements of the original RFP. As a matter of fact, there was therefore no amendment to the solicitation documents through emails sent to bidders. Indeed, the information available indicates that the email correspondence between PWGSC and Onix or other individual bidders after bid closing was not taken into account in the re-evaluation of the bids that was conducted by PWGSC, which is the assessment of the financial bids that matters in this case. Consequently, the Tribunal would have to find that the conditions for inquiry are not met for this ground of complaint as well, even if it had been filed on time.

[43] In summary, PWGSC took appropriate steps to remedy the situation and avoid awarding the contract based on an evaluation procedure that was not contemplated by the RFP. For these reasons, the Tribunal finds that the complaint does not disclose a reasonable indication of a breach of the relevant trade agreements. The bottom line is that, in the end, PWGSC’s clarification requests served no purpose. Therefore, the Tribunal will not conduct an inquiry into this allegation.

DECISION

[44] Pursuant to subsection 30.13(1) of the CITT Act, the Tribunal has decided not to conduct an inquiry into the complaint.